State layoffs again in play

Paterson backtracks, saying he could wield the ax, not the next governor

By RICK KARLIN Capitol bureau

Published
1:00 am EDT, Wednesday, June 16, 2010

ALBANY -- In a reversal, Gov. David Paterson suggested Tuesday he might begin possible state employee layoffs before the end of the year rather than leave it to his successor.

"It's still part of this coming fiscal year," Paterson said of a developing plan for possible layoffs during an interview on The Capitol Pressroom radio show.

Paterson had previously said he was creating a plan for up to 10,000 layoffs, but would leave its execution for the next governor.

But on Tuesday, Paterson said he thought it would be wrong to leave the task of instituting layoffs to someone else.

"It's just gnawing at me. ... I think if you're going to do layoffs, you do them yourself," he said. "And so I'm really considering altering that and starting the layoffs sooner, in 2010. We need $250 million in work force reduction, and we have not come close to that."

Paterson repeated his thinking about layoffs later Tuesday during a phone conference with reporters on his efforts to complete the 2010-2011 budget. It was due April 1 but has been mired in disputes over closing a $9.2 billion deficit.

The governor added that he would have a better idea of whether layoffs are necessary and how many jobs need to go within the next several weeks once officials calculate how much can be saved from an early-retirement package now offered to state employees.

Under the plan, state employees could choose either a "25/55" option that would let people age 55 and older retire after 25 years rather than 30 years without penalty; or take advantage of a month-for-a-year plan in which workers could get an additional month of retirement credit for each year worked, with a 36-month limit.

State employees seeking the second option must hold jobs their supervisors say can be eliminated.

State agencies have been asked to tell Paterson's Budget Division how many people they might lose through the early retirement plans by Monday.

Unions blasted Paterson's new stance on layoffs, noting the governor signed a memorandum of understanding in 2009 pledging not to sack members of two major unions through the end of his term. The unions, the Public Employees Federation and Civil Services Employees Association, maintain the agreement remains enforceable.

"He knows full well he has a legally binding agreement," said CSEA spokesman Stephen Madarasz, who contends the agreement Paterson made has the force of law. Madarasz noted Paterson earlier this year tried to lay off employees in a Queens center for the disabled; after CSEA went to court, the governor settled and agreed not to lay off anyone in that center until the end of the year.

News of potential layoffs also disturbed Albany Mayor Jerry Jennings, whose city is home to thousands of state workers.

"It's almost like we're filling a divot," Jennings said of savings from layoffs. "Unemployment is not good for anyone."

Layoffs or early retirements would be used to make $250 million in savings that Paterson says he needs to help balance the budget.

In addition, the governor said he is working on a plan, long sought by lawmakers, to collect taxes from cigarette sales on Indian reservations. But Paterson cautioned the tax would yield in far less than the $2 billion some legislators say it could generate.

"We are working on an agreement that will allow us to collect taxes -- but will allow us to collect a real number, not a made-up one," he said.

Later Tuesday, the Buffalo News reported that the administration is looking at enacting the cigarette tax plan on Sept. 1, and that it could generate $100 million for the rest of the fiscal year.

One source close to the talks told the Times Union that the proposal under consideration would levy the tax on wholesalers who supply Indian stores. This move is viewed as a compromise under which lawmakers would then agree to the $1-per-pack cigarette tax increase the governor wants to impose statewide.

An Indian leader involved in the cigarette business, though, dismissed the idea as "backroom posturing" by the governor.

"A lot of these guys are putting pressure on the governor," said J.C. Seneca, a cigarette seller and tribal councilor for the Senecas of western New York.

Lawmakers "have got the governor jumping through hoops," he said. "It's the same old story: using the issue, using the Indians in New York as pawns in their game."

Additionally, Paterson said that he would by Thursday send lawmakers bills that lay out the 2010-11 funding plans for economic development, public safety and transportation.

With the full budget 77 days late, the governor has been inserting chunks of his overall plan in the weekly budget extenders needed to keep government operating.

That's angered many lawmakers, who have accused the governor of forcing the budget down their throats in a piecemeal fashion. The Senate almost didn't pass Monday's extender, raising fears of a possible shutdown of state services.

Paterson said he doesn't expect the economic development, public safety and transportation proposals to be controversial and he was offering them outside the next extender -- due by week's end -- in order to try to speed the budget process along.

"I'm just trying to continue the process and make it as short as possible. This is something we could address right now," he said.

Assembly Speaker Sheldon Silver said his conference would take up the measures promptly, but Senate Democratic Majority spokesman Travis Proulx said the chamber would have to review the language in the bills.